Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying, what you should be thinking
Top of the home pages
The Times: UBS, the Swiss bank, became the first European bank to be sued
by an investor over the sale of financial products that collapsed as a
result of the meltdown in US sub-prime mortgages.
The Wall Street Journal: Electronic Arts launched an unsolicited
$2 billion offer to acquire Take-Two, the publisher of the hit Grand
Theft Auto series.
Financial Times: The United Nations agency responsible for relieving
hunger is drawing up plans to ration
food aid in response to the spiralling cost of agricultural commodities.
From the commentators
Anatole Kaletsky in The Times: If the worst that bearish analysts can
say about the poorest-performing big bank is that it will have to cut its
dividend, this amounts to a rather
moderate sort of crisis.
Roger Bootle in The Daily Telegraph: Don't cheer up prematurely. The real
crunch will come when borrowers have to refinance loans.
Stephen King of HSBC in The Independent: Inflation
in emerging economies is soaring. If we pay more for raw materials, yet
are unable to achieve compensating pay increases, our spending power will
dwindle.
Good news
The Times: Vincent Tchenguiz, the property entrepreneur, is to sell his
share in a £490 million Tesco
supermarkets joint venture at a profit of up to £80 million.
The Independent: Fairtrade sales
surged 81 per cent in value last year to £500 million.
BBC: Google, the internet company, has been rated the number
one brand in the UK, according to research by Superbrands.
Bad news
The Times: BAA, the airport owner, is struggling
to sell a portfolio of warehouses and offices around Heathrow and
Gatwick and is under pressure to cut the £1 billion price tag by at least
£100 million.
The Daily Telegraph: House prices
have fallen for a fifth month, with average property prices down 0.2 per
cent and the annual rate of growth at 1.4 per cent.
The Guardian: The Nationwide will tell homebuyers on Monday that unless
they have a deposit of 25 per cent or more of the value of a property they
will face higher mortgage rates.
Mergers and shakers
The Times: India's biggest bank
takeover is expected to be unveiled on Monday at more than £1.3 billion
as local banks begin to consolidate ahead of market liberalisation in 2009.
The Wall Street Journal: Morgan Stanley has short-listed
three bidders for its stake in top Chinese investment bank CICC but is
balking at the latest offers of about $600 million.
Around Asia
The Wall Street Journal: Temasek, the Singapore state investor, is
close to a decision to sell its stake in Indonesia's sixth-biggest lender Bank
Internasional Indonesia.
The Nikkei: Citigroup plans to trim the payroll at Nikko Citigroup, its
Japanese wholesale brokerage unit, by about 10 per cent in a repercussion of
US subprime mortgage losses.
Bloomberg: Zinifex, the third-largest zinc mining company, won
agreement to buy the Australian nickel company Allegiance Mining after raising
its unsolicited offer 10 per cent to A$790 million.
Coming up
The Times: Royal Bank of Scotland is expected to write
down US sub-prime-related assets worth well over £1billion when it
announces its full-year results on Thursday.
The Wall Street Journal: Goldman Sachs might post its smallest
quarterly profit in three years in March as leveraged loans are likely
to weigh on results.
Reuters: Ben Bernanke, Chairman of the US Federal Reserve, will on
Wednesday and Thursday deliver his semi-annual
economic outlook testimony to Congress.
Unfinished business - last week wrapped up
Last Monday
US banks have been quietly borrowing
massive amounts of money from the Federal Reserve by using a measure
introduced two months ago to ease the credit crunch, it was reported.
China's inflation rose 7.1 per cent in
January from a year earlier - the quickest pace in more than 11 years -
after snowstorms disrupted food supplies.
Tuesday
Credit Suisse, the Swiss investment
bank, suspended a 'small group' of London traders after revealing a shock
$2.85 billion (£1.5 billion) asset writedown.
BNP Paribas, France's largest bank,
reported a 42 per cent decline in fourth-quarter profit as it wrote down the
value of securities hurt by worsening credit markets.
Wednesday
The US faces stagflation as the Fed
cut its forecast for growth by 0.5 per cent and it emerged that consumer
prices had risen 4.3 per cent over 12 months, it was reported.
A barrier to the smooth nationalisation of Northern
Rock emerged. An offshore fund with £49 billion of mortgages sold the
bank could be in danger if the Rock fails to win new mortgage business.
Thursday
Controversy over rising power prices
took a fresh twist when Ofgem, the energy industry regulator, launched a
formal investigation into Britain's energy supply market.
Fresh figures showed that retail sales
rebounded to grow 0.8 per cent in January compared with December,
suggesting that the slowdown in the economy is still some months away.
Friday
The three UK bankers who pleaded
guilty for their roles in a fraudulent scheme with Andrew Fastow, Enron's
former chief financial officer, were sentenced to three years in prison.
A deal to pump $3 billion into Ambac,
the bond insurer, could be completed as soon as Monday or Tuesday, if
credit-rating concerns sign off on the arrangement, it was reported.
MARKETS
FTSE 100 5,888.50 down 0.7% (Thursday close)
Dow 12,381.02 up 0.8% (close)
S&P 500 1,353.11 up 0.8% (close)
Nasdaq 2,303.35 up 0.2% (close)
Nikkei 13,775.80 up 2% (latest)
Hang Seng 23,298.53 down 0.03% (latest)
Sterling $1.9666 (latest)
West Texas crude $99.58 up 77 cents (latest)
Gold $951.60 up $3.80 (latest)
Asia
Bloomberg: Asian stocks
advanced on speculation that Ambac, the bond insurer, will secure
fresh capital to salvage its AAA credit rating, averting further writedowns
for global financial companies. Millea Holdings, Japan's biggest
insurer, rose the most in more than four months, while National Australia
Bank, the nation's biggest bank by assets, rose for the first time in
four days. The MSCI Asia Pacific Index was up 1.1 per cent, while Japan's
Nikkei had gained 2 per cent in intraday trading.
Paul Larter
paul.larter@thetimes.co.uk
AGENDA
INTERIMS
Boomerang Plus
Minerva
Waterman Group
FINALS
Bunzl
Brammer
Goals Soccer Centres
Hammerson
Raymarine
Robert Walters
Ultra Electronics
Xchanging
XP Power
AGMs
None scheduled
EGMs
EMAP
YooMedia
TRADING STATEMENTS
Associated British Foods
ECONOMICS
Hometrack UK house price survey (0001 GMT)
BBA UK Jan mortgage lending data (0930 GMT)
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